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Euro area manufacturing PMI improves in May

Euro area manufacturing PMI improves in May

The European Manufacturing PMI rose amid signs of a recovery in European economies as a result of the trend of countries to reopen their economies in the upcoming period after the decline in the rate of coronary virus infections in those countries.

According to data from the IHS Markit Manufacturing PMI, the index rose to 39.4 in May from 33.4 in April, yet it remains far from the 50 mark that separates growth from contraction and slightly below the flash reading of 39.5, the lowest level in the 22-year survey history in April

Chris Williamson, chief economist at IHS Markit, said: "The slowdown in manufacturing appears to have reached its lowest level in April, with production falling at a significantly slower rate in May."

“The improvement in part reflects just a comparison with the sudden sharp decline in April, but the most encouraging thing was also associated with the resumption of business as virus closures were eased," he added.

The indicators showed that the recovery that will accompany the economies in the euro area will be slow, as citizens continue in their homes, amid the closure of many companies during the last period.

However, hopes remain that the European economy has overtaken the worst stage, as evidenced by the rise in the optimism index for the next 12 months, close to the parity point at 50, at 44.6, compared to 36.6 in April.

At press time, the EUR/USD pair rose today, reaching 1.1139 levels, while the pair opened today’s session at 1.1115. Moreover, the single currency is on track for a third straight weekly gain.

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